Huawei to increase procurement spending in Europe

Huawei said it plans to increase its procurement spending in the European Union as part of its overall investment strategy for Europe, and expects to make direct purchases worth an estimated $4.08 billion (€3.8 billion) in 2015.

A company spokesman told FierceWireless:Europe that the estimated amount for 2014 is $3.7 billion. Huawei revealed earlier this year that it purchased $3.4 billion worth of components, engineering and logistical services from Europe in 2013.

The Chinese equipment manufacturer also confirmed plans to hire 5,500 more staff in Europe over the next five years and to double its R&D staff in the next three years.

This latest update on its European investment plans comes just days after the European Commission confirmed it had dropped its threat to launch an investigation into alleged illegal subsidies for Chinese mobile equipment manufacturers.

"Europe remains our top investment destination. The solid ecosystem of trusted partners that we have built up enables us to ensure that these investments deliver sustainable growth for the local economy as well as for our company," said Kevin Tao, president of Huawei Western Europe.

Yet while European suspicions of potentially illegal trading activity by Chinese telecoms equipment vendors appear to have abated, Huawei and its Chinese rival ZTE continue to face a brick wall in the U.S. because of government concerns over espionage--claims the Chinese companies have rigorously denied on several occasions.

This in turn is having an impact on companies in the UK: according to a report in the Cambridge-based publication Business Weekly, CEOs of two companies also based in Cambridge told the publication their U.S. customers have told them to stop dealing with Huawei and ZTE or face losing their U.S. business.

"Our partners in the States have no choice because of their government's intransigence. Basically we have been told--if it's Huawei it's the highway for you. We clearly have a decision to make," one of the CEOs told Business Weekly.

Companies in Cambridge still hope to benefit from Huawei's plan to build a centre of excellence that focuses on the Internet of Things (IoT). Some technology companies there also see opportunities from the Chinese vendor's recent acquisition of IoT specialist Neul.

Huawei CEO Guo Ping recently told the BBC that the U.S. ban was "not very important", saying the company "can wait" until the country was ready.

For more:
- see this Huawei release
- see this Business Weekly article
- see this BBC article

Related Articles:
EU drops threats against Huawei, ZTE
Brussels partly drops threats against ZTE, Huawei
Huawei expects to double European R&D over next 5 years
Huawei spent $3.4B in Europe in 2013, plans more
Alcatel-Lucent wins 2 more LTE deals in China

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